In today’s lesson, you’ll learn about performance. You’ll learn how to define performance and check out a few companies that focus on performance.

Performance simply means doing a job well. We might think of it as an essential characteristic of any brand, but it’s not true. Many products are successful despite not doing what they should do. For example, think about your computer. How many times has it stopped working? How many times has it performed poorly? Nevertheless, you continue to use it because some other things are more important than perfect performance.

However, performance and luxury don’t have to go together. Here are two brands with excellent performance.

senz° umbrella: An umbrella that keeps you dry and won’t break. It words because of its unique design. It has really amazing performance. This umbrella has a higher than normal price, but not so much that we would call it luxury. It’s just really good.

McDonald’s: McDonald’s certainly isn’t a luxury brand and their food is not healthy. But taste and speed define performance for McDonald’s and, in those areas, they always succeed. To create the great taste, McDonalds invests heavily in finding the perfect flavors. Here’s an interesting article on why McDonald’s fries taste so good. The result is one of the best performing brands in the world.

Got questions or comments? How about practicing some new vocabulary and posting your thoughts on the blog, Facebook, or Twitter?

Today’s

Vocabulary

If this product isn’t a phenomenal success, we’re going to go bankrupt.

(3) A hit: Something that was quite popular

Each iPhone seems like it’s a bigger hit than the last one.

Today’s

Questions

1. Which company makes Reece’s Pieces?

a. Hershey’s

b. Mars

c. Hermes

2. Why do companies use product placement?

a. To promote their products

b. To show their products with the target customers

c. A & B

3. By how much did sales of Reece’s Pieces increase?

a. More than 50%

b. More than 75%

c. More than 100%

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GLOBAL MARKETING TUESDAY

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By Jeremy Schaar

Placement is used by luxury brands to put their brand in a luxurious setting. For example, Hermes scarves became very popular after appearing in the movie Basic Instinct.

But many other companies also use placement. For example, cigarette companies wanted Hollywood to show stars smoking in movies.

Perhaps the most famous example of product placement is in the movie E.T. The Extra-Terrestrial. In the 1982 movie by Steven Spielberg, a little boy uses a small candy to lure an alien away from his hiding place. Originally, they were going to use M&Ms, but Mars, Inc. (the company that produces M&Ms) decided they didn’t want to be in the film. So, they used Reece’s Pieces instead.

Hershey’s–the company that makes Reece’s Pieces–agreed to let them use the candy for free. In exchange, Hershey’s had to spend $1 million to promote the movie and they were allowed to use E.T. in their advertisements.

The movie was a phenomenal success. As a result Reece’s Pieces were also a new hit. Sales went up more than 50%. Even today, people remember the movie and enjoy the candy.

Note that this placement is not just successful because the movie was successful. (Though that is definitely true.) The exact placement was also important. A little boy was eating and using the candy. That’s important because children are such important customers for candy.

Partly as a result of the placement of the candy in the movie, these days product placement in movies is common. Usually it’s not a big deal, but everyone is hoping that their product will be the next Reece’s Pieces.

Got questions or comments? How about practicing some new vocabulary and posting your thoughts on the blog, Facebook, or Twitter?

Our carrots are all natural. They’re straight from the ground to the box to the store. We don’t use any chemicals at all.

Today’s

Questions

1. Why does Chipotle use a movie like this?

a. To sell more burritos

b. To create a world that strengthen’s their brand’s persona

c. To create a bond with the customer

2. What persona does Guerlain have?

a. Expensive and difficult

b. Sexy and adventurous

c. Fun and healthy

3. What persona does Chipotle have?

a. Tasty and safe

b. Fast and efficient

c. Healthy and kind

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GLOBAL MARKETING TUESDAY

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By Jeremy Schaar

“Anything you want to, do it. Want to change the world? There’s nothing to it…”

Two lessons ago, I presented the eight Ps of luxury marketing. Today, we’ll continue to look at how companies use those eight Ps. Not all of the companies in this series are luxury brands, but they all use elements of luxury branding. Today, we’ll look at Chipotle and Persona.

Chipotle is a Mexican fast food restaurant. They sell burritos and tacos and so on.

Persona is an idea used by lots of companies. Luxury brands often try to put their products in fantastic worlds filled with sex and adventure. Then, you buy that product because you like the sexy and adventurous persona. Compare this video from the Guerlain perfume house with the Chipotle’s video above.

Guerlain uses the video to set their perfume in a specific world and give their brand a specific persona. Chipotle does the same. They both give their brand a persona. In the case of Chipotle, they’re saying that the world is full of factory farms, but Chipotle is different. They use natural ingredients. They’re healthy and kind. Chipotle is a big business, but they want their brand to live in the world of local farmers and good food. It’s a wonderful world and persona for a food brand.

Got questions or comments? How about practicing some new vocabulary and posting your thoughts on the blog, Facebook, or Twitter?

GLOBAL MARKETING TUESDAY

Most brands, however, aren’t luxury brands. But the elements are useful for many brands. This week, and in the coming weeks, we’ll look at how the different elements of luxury branding can be used.

Nintendo isn’t a luxury brand, but they release a new gaming console every five years or so. At those times, they use one of the elements of luxury branding: paucity.

Again, paucity means rare. And Nintendo has used paucity to great success.

When I was a kid, Nintendo released the Super Nintendo. We all wanted one, but not everyone could find one. No one understood why. Couldn’t they just make more? The same has been true for other consoles. The picture above is of a guy who was very excited that he got to buy a Wii. He looks like he won something! That’s some pretty great marketing when someone gives you money and looks like he won.

Nintendo argues that they don’t know how many consoles to make and that production is hard. Don’t believe it. They sell millions of consoles, but they could sell more. They make their products rare on purpose.

They do it for the same reason that luxury handbag brands make their bags rare. When the product is rare, they can control price and create buzz.

Think about a company like Walmart. Normally, they control the price. Selling something in WalMart is so important for companies, that they must accept whatever WalMart demands. But not Nintendo. WalMart will charge whatever price Nintendo says because Nintendo’s product is rare. If WalMart doesn’t accept the price, Nintendo will just send the truck to another store. It won’t affect their sales at all.

Second, paucity creates buzz. Newspapers write about people trying to find a Nintendo Wii. People who do buy one get excited and and brag to their friends. In future years, this buzz continues to generate sales.

The strategy only works, of course, if the product is really good. A handbag should be fabulous and the Nintendo Wii should be a lot of fun to play.

Nintendo has used this strategy for almost 30 years. So, the next time Nintendo makes a new gaming console, don’t believe them when they say they don’t know how many to make and that it’s hard to produce as many as they want. They know exactly what they’re doing. It’s a very successful marketing strategy.

Got questions or comments? How about practicing some new vocabulary and posting your thoughts on the blog, Facebook, or Twitter?

Answers To Today’s Questions

C, A, A

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Today’s

Vocabulary

Paucity can occur because something is expensive to produce, the raw materials are rare, or just because a company decides to not make a lot.

(2) Pedigree: The history of something, usually it’s used in a positive way

I haven’t worked with that firm before, but they have excellent pedigree. I’m sure we can trust them.

(3) To reinforce: To make stronger

Each part of a brand should reinforce the other parts. For example, the performance should make the persona stronger.

Today’s

Questions

1. Why is it important to study luxury marketing?

a. All brands should try to become luxury brands

b. It’s key for making more money

c. Some ideas can be used for any brand

2. How do luxury brands use public figures and PR to help their brands?

a. They reinforce the other parts of the brand

b. They allow them to charge high prices

c. They make it hard to learn about the brand

3. How should luxury brands be placed?

a. In an exclusive environment

b. In a luxurious environment

c. A and B

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GLOBAL MARKETING TUESDAY

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By Jeremy Schaar

What brands do you think of when you think of luxury? Brands like Gucci, Versace, and Rolex probably come to mind. These brands have done an excellent job marketing their products. They represent luxury and they’re able to charge very high prices as a result. But why? What makes them special? What are the secrets to luxury marketing?

Today on the blog, we’ll review the eight Ps of luxury marketing. You’ll learn some great vocabulary. And, even if you don’t have a luxury product, you’ll learn some ideas that you can use to market your brand. In the coming weeks, we’ll look at companies that use luxury brand strategies well (even if they don’t have a luxury brand).

According to Rohit Arora, these are the eight Ps of luxury marketing. I’ll review his ideas in simple English. After you finish this lesson, I suggest you read his whole paper.

Performance: This means that experience with the product should be great. If it’s a watch, it should be a great watch. If it’s a car, it should be a pleasure to drive.

Pedigree: Pedigree means good history. Chanel and Gucci don’t just make great products now, they have a long history of being amazing.

Paucity: Paucity means rare. Products can be rare for different reasons. Some are just hard to get–like diamonds. Others, like a custom car, are hard to create. Others, like an Hermes tie, are just produced in small numbers on purpose.

Persona: It’s the personality of the brand. The brand should create an emotional connection. Often advertisements make it seem that the brand lives in an amazing world full of sex and adventure.

Public Figures: Actors, actresses, musicians, sports stars, and so on. They’re people we admire, so we trust them when they speak about performance. They also reinforce the pedigree, paucity, and persona of the brand.

Placement: Placement isn’t just an element of luxury marketing. It’s one of the four basic Ps of marketing. The brand should be placed in a luxurious or hard to reach environment. The magazines and events where a brand is featured are also part of placement.

PR: Good public relations for a luxury brand will give the brand buzz that reinforces the other Ps.

Pricing: And here’s the big one. Luxury brands are expensive. The price makes us trust the performance and makes the brand rare–if only because most can’t afford to buy it.

Got questions or comments? How about practicing some new vocabulary and posting your thoughts on the blog, Facebook, or Twitter?

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About Jeremy

I'm passionate about education and communication. For me, Stuart Mill English is about helping students learn and teachers teach. And all the great things that come when students succeed and teachers thrive. Thanks for stopping by.